Wednesday, January 5, 2011

Flint and Public Pensions

It’s a shame that incomes and property values have fallen so much that we can’t meet our promises to retirees. Add the demographic shift, and the situation stinks!

On a local level, Flint City Council recently rolled the defined contribution plan into the defined benefit plan. The argument from Council was this action would save the General Fund $4m this year because the defined benefit plan was dangerously underfunded. All this was on the third add-on resolution, i.e. a resolution not on the official agenda, at the 11/8/2010 meeting.

What I don’t know is whether the city simply pooled the money together in an accounting arrangement or whether the city functionally eliminated the defined contribution plan. Does anyone know more of the details?

7 comments:

This illustrates the folly of both shipping jobs overseas for profits and not trying to rebuild a manufaturing base due to environmental regulations. When you talk about "sustainable growth", it inevitably results in no growth. Not only does this affect jobs, which pay for mortgages, it affects the growth of pension funds, which for years grew with the stock market returns. Inevitably with all this, housing prices fell also, to the point where arson becomes attractive, and the only solutions offered are returning urban lands to parks and farming.

Why should they get a pension when the overwhelming majority of Americans do not get a pension? They are getting a pension on the backs of the ones who don't. So I guess I would say...who gives a sh$t about them.

Oh ok mr anonymous, under contracts, signed contracts, agreements, people who have worked under pension plans agreed by there employee and employer years ago should not get there pension. In other words, A person who has worked for 30 years or or so under a pension plan which was created by there employer should just be taken away? Let me guess, your under a match program with your 401k...hey, lets take away that match program money you have worked for 30 yrs because I'm your employer and I decided I(your employer) can't afford to pay you that matched 401k program I promised you 30 yrs ago.

People need to unite and quit throwing each other under the bus. Fight against how the hard working americans are being layed and payed less. Was it fair that the head cheese of the Flint Journal received an increase of pay while meanwhile the mass of workers are layed off?

Wake up..quit fighting against each other and fight against outrageous bonuses for ceo fatcats and bank fatcats and politicians...republican and democrats!!!

Apparently we are all so gulible to believe all this hype from the politians~!!!

Anonymous2, The point is that these were City of Flint pensions, not private company pensions. People were promised a pension by individuals who were not making money to fund the pension but used citizen’s taxes. As usual they did not fund the pensions properly and wasted the money. The ones who don't have a City of Flint pension just had to move away and get a real job and will not get a pension or a 401K. So maybe they should still have to work like me and most other Americans.

But the reason I posed the question was Flint's Council actions weren't reported in local paper, and I wondered whether anyone knew if Flint completely eliminated the 401k-type plan or whether it was an accounting trick to save big money.

Thanks for commenting. You might enjoy my book about Flint called "Teardown: Memoir of a Vanishing City," a Michigan Notable Book for 2014 and a finalist for the 33rd Annual Northern California Book Award for Creative NonFiction. Filmmaker Michael Moore described Teardown as "a brilliant chronicle of the Mad Maxization of a once-great American city." More information about Teardown is available at www.teardownbook.com.

"Teardown: Memoir of a Vanishing City" by Gordon Young

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A blog for the long-lost residents of the Vehicle City by Gordon Young

"I grew up on the Eastside and recall the unexplained pride I felt when the 3:30 Buick factory whistle blew and the roughly dressed workers poured out of the General Motors labyrinth swinging their lunch pails. Some were headed for home and some for the corner bar, but all with the determined step of an army after a battle won. I somehow felt as if I were a part of this giant assembly line and the city it fed."